Russia’s fiscal deficit in December is at a record high – Bloomberg

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Russia’s monthly fiscal deficit reached a record 3.9 trillion rubles in December amid the European Union’s embargo on seaborne crude oil exports and the increased operational cost of Russia’s invasion of Ukraine, according to preliminary budget data analyzed by Bloomberg.

Finance Minister Anton Siluanov also confirmed on Tuesday that Russia’s total budget deficit in 2022 amounted to 3.3 trillion rubles ($47 billion) or 2.3% of the country’s gross domestic product, making it the second largest deficit in Russia’s modern history, surpassed only by that recorded in The year is 2022. The year is 2020, at the height of the coronavirus pandemic.

However, Siluanov remained optimistic about the resulting figure during Tuesday’s cabinet meeting, noting that “money earmarked for government extra-budgetary funds through deferral of insurance premiums” should be taken into account when analyzing the size of the budget deficit.

“If we subtract this money from the volume of expenditures, then the deficit amounted to 1.8% of GDP, which is less than 2%, as planned,” Siluanov said.

Russia’s total government spending in 2022 amounted to 31.11 trillion rubles, exceeding pre-war forecasts by more than a third and the amount spent in 2021 by more than a quarter.

Taxes on export sales of oil, gas and other commodities were the main source of revenue for the Russian budget in 2022. Revenue generated from taxes on oil sales increased by 33% year-on-year, while tax revenues from gas sales also increased by more. than three times.

However, in light of recent EU sanctions and the Union’s gas price cap, the budget will not be able to count on commodity exports in 2023.

“Russia is heading into the new year without this big protection, without the European market for gas exports, with lower oil prices and lower oil export volumes,” economist Janice Kluge of the German Institute for International and Security Affairs said in an interview with Reuters. The Moscow Times reported earlier this month, adding that this “would be a huge problem”.

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